Skiracer's stock slopes

[skiracer]

Ski, Could you explain your use of the 20DMA , 50DMA and resistance and support levels in your shorter term trading ? Also healthy vs. dangerous pullbacks. Thanks


------------billy

The 20 and 50 dma's can offer either resistance or support depending on whether the stock is trading above or below their line. When above they're resistance and below act as support. I use the 20 moreso than the 50 only because it offers a shorter term view of what the stock has been doing within the past few months (2-3 months) and the 50 for longer term (4-6 months). What I look for specifically is how long a stock has been tracking in either direction to determine "trend" and for crossovers either up or down.

Crossovers are important to me as it is a strong signal when the 20, which normally will be tracking above it's 50, crosses and drops below it's 50. Moving averages are strong lines of support or resistance and when one crosses over the other it's a big thing for me. When the 50 is tracking below it's 20 and the 20 turns down and drops below that line of support at it's 50 I take that as a strong signal that the stock is weakening and any entry to the long side wouldn't be prudent at that time. And visa versa. When the 20 has been tracking below it's 50 and turns up and crosses back over it's 50 that to me is a stronger indication that entry to the long side is your best bet and the "edge" is certainly in your favor. The best part about using the moving averages as indicators is that you can watch and see the movement long before any actual crossover takes place and can thus anticipate "a developing trend" and time your trade/entry for that moment that best suits your discipline.

I like that moment when I have been watching a stock begin a move up from a point where it's 20 has been tracking below it's 50 and after watching it for a week or two (and sometimes longer) it gets right up to it's 50, remember this line is a strong line of resistance to break thru, and knowing that it has been trending up for a couple of weeks, watch it break thru that line. To me that is a perfect time for entry and especially if the market in general has been in and uptrend itself. Being early doesn't bother me at all knowing that the most I am going to lose is my standard 7% stoploss or less in some cases.

Sometimes that line of resistance will stop a stocks advance and deny it's crossing over the line. Many times you will see a stock try 2 or 3 times to breach that resistance and be denied. Each time this happens it only supports my feelings that the stock is strengthening and that the "odds" are increasing that it will make a successful breach of that line. I have made numerous trades where my timing has been wrong or early and I have had to exit at my stoploss point but in the end see the stock make a successful crossover and go on to make up the nominal losses and and much more. The stop loss is your only and strongest defense.

[billyjoe]

Ski, Could you explain your use of the 20DMA , 50DMA and resistance and support levels in your shorter term trading ? Also healthy vs. dangerous pullbacks. Thanks


------------billy

[skiracer]

Ski, There were a couple downgrades for homebuilders in general today, but even the analysts still see a 30% greater move before a leveling off. 30% more in HOV would be nice.

----------billy

the stock is way way underpriced Billyjoe. I had posted earlier to Noshadyldy that the chart was indicating some degree of consolidation/profit taking when it was around $3.89 level which I thought at the time that a 5/8% drop would be normal. if that happened it would put the stock at around$3.40-$3.50 range which is still way above any of our entries. I'm advocating and, speaking for myself, am going to hold onto my shares because I feel confident that the stock will reach and surpass the $5.00 level. Another 30% rise from todays close would place the stock right around that range. I think it goes higher than that but I don't want to tout something that I am not sure of or can guarantee. I would like to see you and anyone else holding shares stick with the stock but everyone has to do what is best for themselves and their situation. My first trade was from $1.00 to around $3.10 when I exited. I re-entered at $2.75 level and lost 7% once or twice and am now in again from around $2.65 range. I'm playing with the houses money and am just waiting it out to see which way the wind is going to blow. I'm up over $3000 on this current trade and made around $6500 on the first one.

[billyjoe]

Ski, There were a couple downgrades for homebuilders in general today, but even the analysts still see a 30% greater move before a leveling off. 30% more in HOV would be nice.

----------billy

[noshadyldy]

Wow, wonder what happened there. These pharmaceuticals are so volitaile, especially when a clinical trial doesn't click like expected. Probably what happened with this one. Did you hear or see anything on the news of what is going on.

No I haven't had a chance to do any research on it, but when looking at the rapid rise and bullet speed drop to such extremes, it would see that pump and dump may have been at least part of the problem.

[skiracer]

Wow! Now I'm glad I didn't get to buy PPHM. With my penchant for staying in too long, it would have been horribly painful!

Wow, wonder what happened there. These pharmaceuticals are so volitaile, especially when a clinical trial doesn't click like expected. Probably what happened with this one. Did you hear or see anything on the news of what is going on.

[noshadyldy]

Look out below!

Wow! Now I'm glad I didn't get to buy PPHM. With my penchant for staying in too long, it would have been horribly painful!

[noshadyldy]

Thankful

ASTI taking a big hit today. When they don't make any money and the possibility of making money is far into the future if that, why would anyone want to buy into that?

Glad you posted that info on it because I'd have bought into it and gotten bit pretty badly.

[skiracer]

ASTI taking a big hit today. When they don't make any money and the possibility of making money is far into the future if that, why would anyone want to buy into that?

[noshadyldy]

I wasn't saying it couldn't go to $8 or above. It may well do that. I was just suggesting that it's been on a nice ride up over 25/30% and could be due for a pullback to consolidate some of those gains. Wasn't implying anything else.
When I find a cup base that looks to be completing it's bottom I usually wait until I see it just starting to make that turn up and to me that is the best time to make an entry on these cup bases. If you are early and it doesn't work out the worst you can do is lose 7% and then watch it and give it another try if you think it is worthwhile. I like the cup base chart patterns alot but they are not the only ones that I look for. There are a number of other bullish patterns that are actually stronger than the cup bases percentage wise. If you were to ask any number of traders about entering these cup bases at the point that I like to get in probably a higher percentage of them would disagree with my entry points and timing. I say to each his own as long as you have a plan and honor your stops and stick to them. I don't make that many trades but when I do you can bet the "edge" is in my favor and I always maximize the trade and the targeted exit point.

I totally understood, Ed. I was just saying I might not jump out for the pause/retrace and just ride it a bit higher when it starts up again.

[skiracer]

Super! Maybe I'll catch the next one as early on as you do.

I wasn't saying it couldn't go to $8 or above. It may well do that. I was just suggesting that it's been on a nice ride up over 25/30% and could be due for a pullback to consolidate some of those gains. Wasn't implying anything else.
When I find a cup base that looks to be completing it's bottom I usually wait until I see it just starting to make that turn up and to me that is the best time to make an entry on these cup bases. If you are early and it doesn't work out the worst you can do is lose 7% and then watch it and give it another try if you think it is worthwhile. I like the cup base chart patterns alot but they are not the only ones that I look for. There are a number of other bullish patterns that are actually stronger than the cup bases percentage wise. If you were to ask any number of traders about entering these cup bases at the point that I like to get in probably a higher percentage of them would disagree with my entry points and timing. I say to each his own as long as you have a plan and honor your stops and stick to them. I don't make that many trades but when I do you can bet the "edge" is in my favor and I always maximize the trade and the targeted exit point.

[noshadyldy]

Super! Maybe I'll catch the next one as early on as you do.

[noshadyldy]

I think you made a great entry and have done well for yourself. I would think it is nearing a point where a consolidation of gains is due. It's been on a nice ride up from $3.75 levels.

Thanks. Somewhere it was projected to be headed for $8.00. I'm not good at timing the market and might sit in and wait.

[skiracer]

Yes, I've been in it since Aug 23, @ 4.26 for a nice take of 19.7% so far. I was tempted to take it and run but then I saw how the chart looks like it's setting up for another move upwards. What do you think?

I think you made a great entry and have done well for yourself. I would think it is nearing a point where a consolidation of gains is due. It's been on a nice ride up from $3.75 levels.

[noshadyldy]

Holdings - it's all about the bowl!

For the record, my holdings are:

GPL HOV NSPH AUNFF FVE GDXJ BZH CSCO

also LIOX and TCX - don't know how smart those were but it really is all about the bowl for me. (2 yr LIOX and 6 mo for TCX.) TCX is one rough bowl, don't even know if you could call it that but when you look at it's action, it's sitting right at about where another pop should be coming up. There's some good hack saw motion for trading.


Like the bowls on:
ACAD 2 yr
FBC 2 yr (strong bottom formed)
JOEZ 2 yr
VELT 2 yr
KBH 2 yr but already progressed quite a bit
POWR 2 yr, solid consolidation on double bottoms
ASTI 2 yr
DARA 1 yr

Any and all opinions, criticisms and pot shots are welcome.